From December 31, 1990 to December 31, 2010, the S&P 500 gained +9.1% per year.
But the average equity fund investor has gained less than half of much, only +3.8%!
During the same period, the typical aggregate bond index gained +6.9% per year.
But the average fixed income investor has earned 7 times less!!!, only +1.0%!
BOTTOM LINE:
1. Sadly, over the past 2 decades, investors haven't built any real wealth during neither the past 10 years nor the past 20 years. Taxes, inflation, fear, greed, the business cycle, financial crises and market meltdowns all conspired to, not grow, and not even maintain, but shrivel the purchasing power of the average investor.
2. The vast majority of passive investors simply don't have and never will have the psychological discipline to keep the faith during bear markets meltdowns of -30%, -40% or -50% that decimate their retirement nest eggs.
And who can blame them?
Thankfully, there is a better way.
No comments:
Post a Comment